Boom

Finance usually treats bubbles as mispricing. Byrne Hobart and Tobias Huber flip the frame. Their claim is that progress in the West has slowed since about 1970, and that what is missing is the collective, irrational-looking commitment bubbles create. A shared vision of a different future pulls in money and talent faster than any sober cost-benefit analysis would, and the overbuild it leaves behind, like the fiber laid in the dot-com era, becomes the next generation's infrastructure.

Hobart writes The Diff, a daily newsletter on inflection points in finance and technology, and he and Huber, who holds a doctorate from ETH Zurich, are partners at the frontier-tech investment firm Anomaly. The book separates bubbles that bet on a genuine break with the past from momentum-driven, often leveraged manias that assume the present will simply continue.

Reviewers split. Blockworks and the Washington Free Beacon found the reframing original and ambitious. Critics said the authors stretch the word bubble to cover state-funded programs like the Manhattan Project, pick only success stories and say little about the retail investors who absorb the busts. Several flagged dense, jargon-heavy prose and a final section that drifts from economics into philosophy and religion.

Read it alongside Carlota Perez or Charles Kindleberger if you invest in early-stage technology, cover capital-intensive sectors or are trying to judge the AI spending cycle.

1. Not all bubbles are alike. The useful question is whether a mania is betting on a real break from the past or on momentum continuing; the second kind, often leveraged, is where the authors locate the destructive busts.
2. Overbuild can be the point. Railroad and dot-com fiber capacity that bankrupted investors became cheap infrastructure later, so investor losses and social returns can diverge sharply.
3. Coordination is a financial function. A shared, credible forecast, like the industry's faith in Moore's law, lets suppliers, customers and capital commit in parallel instead of waiting on each other.
4. Venture capital manufactures bubbles. Early-stage investors back many go-big-or-go-to-zero visions and diversify the failures away, which is why that model attracts optimists rather than short sellers.
5. Watch who bears the bust. The book's critics point out that the costs of a burst bubble fall heavily on late retail buyers and workers, a caveat to keep in mind when hype is used to justify any capex cycle, including AI.

The book has no conventional narrative. Reviews describe an argument that moves from diagnosis to case studies to a philosophical close:

1. Defining the bubble. The authors set out what they mean by a bubble: a definite vision of a new future that draws unusual commitment from early believers. They contrast bubbles that bet on an inflection with those that bet on mean reversion.
2. Diagnosing stagnation. Slower physical progress since about 1970 is blamed on risk aversion across government, finance and culture, with a long detour through the end of Bretton Woods, fiat money and what they call financial nihilism.
3. Bubbles that built things. Historical manias in railroads, telegraphs and dot-coms ruined late investors but left lasting assets, while Moore's law worked as a self-fulfilling prophecy for chipmakers and software developers.
4. Megaprojects and missions. The Manhattan Project, Apollo, fracking, Covid-era vaccine work and Bitcoin are read as small, well-funded groups united by a vision and loosely held to account.
5. The machinery of enthusiasm. Chapters on how bubbles work socially cover founders, quasi-religious movements and venture capital as an industry that seeds many bubbles and diversifies.
6. Risking more than money. The close draws on René Girard and Martin Heidegger and urges readers to stake their time and identity on ambitious projects.